What Happened?
Shares of online used car dealer Carvana (NYSE: CVNA) jumped 9.6% in the morning session after Piper Sandler analysts upgraded the stock from Neutral to Buy, suggesting that the company's reduced valuation presented a buying opportunity. The analysts added "We would use the recent sell-off to accumulate CVNA shares."
After the initial pop the shares cooled down to $184.64, up 4.9% from previous close.
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What The Market Is Telling Us
Carvana’s shares are extremely volatile and have had 44 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock dropped 10.9% as markets seemed to have caught "tariff/trade war fever" once again (Nasdaq down 1.9%, S&P 500 down 1.2%) amid broader geopolitical anxiety. The volatility was perhaps also related to uncertainty surrounding the Fed's rate decision to be announced later in the week.
Carvana is down 7.5% since the beginning of the year, and at $184.64 per share, it is trading 35.3% below its 52-week high of $285.33 from February 2025. Investors who bought $1,000 worth of Carvana’s shares 5 years ago would now be looking at an investment worth $6,291.
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